Cell-cell communication plays a key role in may cellular differentiation processes. Induction of the R7 photoreceptor cell in the Drosophila compound eye by the neighboring R8 cell has become one of the classic examples for an inductive interaction between two cells. R7 is induced by an interaction between the sevenless (sev) receptor tyrosine kinase on the surface of the R7 precursor cell and bride of sevenless (boss), expressed on the surface of the neighboring R8 cell. The long term goal of this research is to understand the biochemical steps in the R7 inductive pathway. This proposal concentrates on an analysis of the inducing ligand boss. The boss protein is composed of a large extracellular domain (498 amino acids), a transmembrane region with seven membrane spanning segments (7TM region is necessary for the activation of sevenless and induction of R7 cell fate. The large extracellular into the neighboring R7 cell as a consequence of its interaction with the sev receptor. These findings raise a number of important questions: How does boss act as a ligand for the sev receptor? Does the 7TM domain constitute part of the binding site for the sev receptor? Alternatively, is the 7TM region necessary to interact with a second protein to form a homodimer or heterodimer? What is the mechanism of transfer of boss into R7? These questions will be addressed by the following specific aims: 1. Define the role of the boss 7TM region in activating the sev receptor tyrosine kinase. Chimeric proteins will be used to define the minimal part of the 7TM region required for R7 induction and to infer its functional significance. 2. Purify and functionally reconstitute the boss protein. If reconstituted boss protein is not sufficient for activation of the sev receptor tyrosine kinase we will identify intermediate steps of boss internalization. Mutations in many -if not all- of the critical components of the signal transduction pathway inducing R7 development will soon be available. These mutations provide a perfect setting for an analysis of this pathway. A combination of biochemical and genetic methods using cell culture systems and transgenic animals will allow an intimate knowledge of this pathway. This knowledge will lay the foundation for understanding numerous signaling pathways regulating such diverse processes as neuronal differentiation, growth control and neoplasia. A knowledge of signal transduction at the level of specific protein-protein interactions will be an invaluable step forward in the direction of the rational design of drugs regulating these processes.